The local utility said the purchase of the plant emerged as the best option from a recent round of competitive bidding that it conducted to meet growing electricity demand in the region.

The purchase would be completed in 2011 and appears to be a setback to plans for a power plant adjacent to Santee at the Marine Corps Air Station Miramar, which would have provided similar electric generation capacity.

Located about 40 miles southwest of Las Vegas, the El Dorado plant began operations seven years ago and has the capacity to produce about 480 megawatts, or enough to power more than 300,000 homes.

The plant currently sells power on the open market to customers in California and is being used at 80 to 85 percent of its capacity, according to Sempra.

As part of a settlement last October to resolve allegations brought by state regulators and the attorney general that Sempra manipulated the natural gas market during the power crisis, the company offered SDG&E an option to buy the Nevada generating facility.

At the time, California Public Utilities Commission President Michael Peevey said the $189 million option represented a $100 million discount, as compared with similar generating plants.

SDG&E said yesterday that its request for bids to supply electricity in March yielded one other competitive offer. But the utility said that the El Dorado option was far better.

“El Dorado was selected because it had by far the least cost and best fit for San Diego customers,” said Jennifer Briscoe, a spokeswoman for SDG&E.

She noted that the purchase of El Dorado had been approved by a procurement review group that included an outside expert; The Utility Reform Network, a Bay Area consumer group; and a representative from the Division of Ratepayer Advocates, a unit within the Public Utilities Commission that represents consumers' interests.

Steve Hoffmann, president of the western division of NRG Energy, which owns the Carbillo Power Plant in Carlsbad, said building a facility like El Dorado today would cost about $500 million.

“These plants have a useful life of at least 30 years,” Hoffmann said. “I think it's a good deal for the ratepayer of San Diego.”

Hoffmann noted that the purchase of El Dorado wouldn't affect plans for the Cabrillo plant, which NRG would like to replace with so-called peaking power plants, which have quick-start capability to supply energy during periods of high demand.

By contrast, El Dorado is a baseload plant, designed to provide a continuous flow of electricity.

But while the purchase of El Dorado appears to have little impact on NRG's plans, it may mean much more to Enpex Corp., which is proposing to build the plant at MCAS Miramar.

The Del Mar company's plan has been to build a baseload power plant at that site, but the proposal may no longer have a local customer, given that SDG&E will satisfy its projected demand with El Dorado, as well as two other local plants.

Enpex did not return a call seeking comment.

The prospect of a setback for the Enpex proposal was welcomed by Randy Voepel, the mayor of Santee, which has spent about $100,000 to oppose a new power plant at its border.

“I am absolutely pleased,” Voepel said. “I believe SDG&E was sensitive to our criticism of the project.”

The purchase of El Dorado would return SDG&E to an ownership position comparable to one it held until the late 1990s, when it owned two local power plants.

But the utility was required to divest the power plants as a condition for approval of a merger of its parent company with the parent of Southern California Gas Co.

The planned purchase of El Dorado follows the purchase last year of the Palomar Energy Center, which SDG&E also acquired from its parent company.

In addition, SDG&E has an an option to buy the power plant under construction on Otay Mesa by Calpine Corp. That option would become effective 10 years after the planned start of operations for Otay Mesa in 2009.

Michael Shames, executive director of the Utility Consumers' Action Network, a local utility watchdog group, said the purchase of El Dorado appears to be a good deal for ratepayers. He also said he welcomed the addition of a second plant to the fleet now owned by SDG&E.

“I believe that when utilities own power plants, they generally get a better deal,” Shames said.

The PUC is scheduled to issue a preliminary decision on SDG&E's plan to buy El Dorado by Nov. 5 and make a final decision Dec. 6.